Westamerica Bancorporation Reports Third Quarter 2021 Financial Results

SAN RAFAEL, CA: Westamerica Bancorporation (Nasdaq: WABC), parent company of Westamerica Bank, generated net income for the third quarter 2021 of $22.1 million and diluted earnings per common share (“EPS”) of $0.82. Third quarter 2021 results include “make-whole” interest income on corporate bonds redeemed prior to maturity, which increased EPS $0.02. These results compare to net income of $22.6 million and EPS of $0.84 for the second quarter 2021, which included “make-whole” interest income on corporate bonds redeemed before maturity, which increased EPS $0.04.

“Westamerica’s valuable deposit base generated a very low 0.03 percent annualized cost of funding our loan and bond portfolios during the third quarter 2021. Operating expenses remained well managed in the third quarter 2021, delivering fifty-five percent of revenue to pre-tax income. Credit quality remained solid with nonperforming loans of $1.8 million at September 30, 2021,” said Chairman, President and CEO David Payne. “Third quarter 2021 results generated an annualized 11.6 percent return on average common equity, and shareholders were paid a $0.41 per common share dividend during the quarter,” concluded Payne.

Net interest income on a fully-taxable equivalent (FTE) basis was $44.0 million for the third quarter 2021, including “make-whole” interest income on corporate bonds redeemed prior to maturity of $732 thousand. Third quarter 2021 net interest income (FTE) compares to $44.5 million for the second quarter 2021, which included “make-whole” interest income on corporate bonds redeemed prior to maturity of $1.4 million. PPP loan average balances declined to $145 million for the third quarter 2021 from $208 million for the second quarter 2021; at September 30, 2021 PPP loans totaled $103 million. Checking and savings deposits represented ninety-eight percent of the Company’s average deposit base during the third quarter 2021, generating a low 0.03 percent annualized cost of funding interest-earning assets.

At September 30, 2021, nonperforming loans declined to $1.8 million due to the full payoff of a $3.1 million non-accrual loan during the third quarter 2021. The allowance for credit losses on loans was $23.9 million at September 30, 2021. The Company continues to work with loan customers requesting loan payment deferrals due to economic weakness caused by the pandemic. At September 30, 2021, loans with deferred payments totaled $1.0 million, all of which were consumer automobile loans.

Noninterest income for the third quarter 2021 totaled $11.3 million, compared to noninterest income for the second quarter 2021 of $11.0 million. The increase in noninterest income was primarily due to higher levels of deposit related fees.

Noninterest expense for the third quarter 2021 was $24.7 million compared to $24.3 million for the second quarter 2021.

Westamerica Bancorporation’s wholly owned subsidiary Westamerica Bank, operates commercial banking and trust offices throughout Northern and Central California.

Quarterly Financial Highlights

FORWARD-LOOKING INFORMATION:

The following appears in accordance with the Private Securities Litigation Reform Act of 1995:

This press release may contain forward-looking statements about the Company, including descriptions of plans or objectives of its management for future operations, products or services, and forecasts of its revenues, earnings or other measures of economic performance. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.”

Forward-looking statements, by their nature, are subject to risks and uncertainties. A number of factors — many of which are beyond the Company’s control — could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. The Company’s most recent reports filed with the Securities and Exchange Commission, including the annual report for the year ended December 31, 2020 filed on Form 10-K and quarterly report for the quarter ended September 30, 2020 filed on Form 10-Q, describe some of these factors, including certain credit, interest rate, operational, liquidity and market risks associated with the Company’s business and operations. Other factors described in these reports include changes in business and economic conditions, competition, fiscal and monetary policies, disintermediation, cyber security risks, legislation including the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2011, the Sarbanes-Oxley Act of 2002 and the Gramm-Leach-Bliley Act of 1999, and mergers and acquisitions.

Forward-looking statements speak only as of the date they are made. The Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date forward-looking statements are made.

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For additional information contact:

Westamerica Bancorporation
Robert A. Thorson, Senior Vice President and Treasurer, (707) 863-6840
E-mail: investments@westamerica.com

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